blurry graphics

[LunaMoo]

Not sure if retroarch has ppsspp gui, but I think the option you want to find is called "Screen scaling filter". By default it's set on linear which will stretch the image adding lots of blur althrough it only really is terrible if you're using small rendering res on high resolution window/display or if you're really sensitive. Change it to nearest and it will be as sharp as original would be.
Textures itself also are filtered, auto let's the game decide which gives original look, but if you're fan of huge pixels caused by unfiltered low res textures stretched to much bigger sizes for FX and stuff, then you also can change that to "nearest".
Note that many psp games might be using other kinds of blurry effects by themselves and you can't do much about it other than hacking/modding the game itself.

Either way you will never see "pixel accurate replication", since each of the different PSP model had different display and they all more or less sucked, what you will see on modern LCD or even on old headache cannon aka crt will never be exactly same as watched on original psp LCD.

Edit: Also, what's exactly your problem in running PPSSPP by itself? Win 7 x64 is likely the most stable OS for any windows friendly emulators, PPSSPP is no exception here. Tried latest version?